Cambodia

1.

This
Agreement shall apply to taxes on income imposed on behalf of a Contracting State or
local authorities, irrespective of the manner in which they are
levied.

2.

There
shall be regarded as taxes on income all taxes imposed on total income, or on elements
of income, including taxes on gains from the alienation of movable or immovable property
and taxes on wages or salaries.

3.

The
existing taxes to which the Agreement shall apply are:

(a)

in
Indonesia:the income tax.(hereinafter referred to as “Indonesian
tax”);

(b)

in
Cambodia:

(i)

Tax
on Profit including Withholding Tax, Minimum Tax, Additional Profit Tax on Dividend
Distribution and Capital Gains Tax;

(ii)

Tax
on Salary;

Nothing
in this Agreement shall prevent the application of the
Minimum Tax
(hereinafter referred to as “Cambodian tax”);

4.

The
Agreement shall apply also to any identical or substantially similar taxes on income
which are imposed by either Contracting State after the date of signature of this
Agreement in addition to, or in place of, the existing taxes referred to in this
Article. The competent authorities of the Contracting States shall notify each other of
any substantial changes which have been made in their respective taxation
laws.

1.

For
the purposes of this Agreement, unless the context otherwise
requires:

(a)

(i)

the
term “Indonesia” comprises the territory of the Republic of Indonesia as defined in its
laws, and the adjacent areas over which the Republic of Indonesia has sovereignty,
sovereign rights or jurisdiction in accordance with international
law;

(ii)

the
term “Cambodia” means the territory of the Kingdom of Cambodia, as well as those
maritime areas, including the seabed and subsoil adjacent to the outer limits of the
territorial sea and airspace over which the Kingdom of Cambodia exercises, in accordance
with international law, sovereign rights of jurisdiction;

(b)

the
terms “a Contracting State” and “the other Contracting State” mean Indonesia or Cambodia
as the context requires;

(c)

the
term “person” includes an individual, a company and any other body of
persons;

(d)

the
term “company” means any body corporate or any entity that is treated as a body
corporate for tax purposes;

(e)

the
terms “enterprise of a Contracting State” and “enterprise of the other Contracting
State” mean respectively an enterprise carried on by a resident of a Contracting State
and an enterprise carried on by a resident of the other Contracting
State;

(f)

the term “international traffic” means any transport by a ship
or aircraft operated by an enterprise of a Contracting State, except when the ship or
aircraft is operated solely between places in the other Contracting
State;

(g)

the
term “national” means:

(i)

any
individual possessing the nationality or citizenship of a Contracting State;
and

(ii)

any
legal person, partnership, or association deriving its status as such from the laws in
force in a Contracting State;

(h)

the
term “competent authority” means:

(i)

in
the case of Indonesia, the Minister of Finance or any representative authorised by the
Minister;

(ii)

in
the case of Cambodia, the Minister of Economy and Finance or any representative
authorised by the Minister.

2.

As
regards the application of the Agreement at any time by a Contracting State, any term
not defined therein shall, unless the context otherwise requires, have the meaning that
it has at that time under the law of that State for the purposes of the taxes to which
the Agreement applies, any meaning under the applicable tax laws of that State
prevailing over a meaning given to the term under other laws of that
State.

1.

For
the purposes of this Agreement, the term “resident of a Contracting State” means any
person who, under the laws of that State, is liable to tax therein by reason of his
domicile, residence, place of incorporation, place of management, principal place of
business or any other criterion of a similar nature, and also includes that State and
any local authority thereof. This term, however, does not include any person who is
liable to tax in that State in respect only of income from sources in that
State.

2.

Where,
by reason of the provisions of paragraph 1 of this
Article an individual is a resident of both Contracting States, then his status shall be
determined as follows:

(a)

he
shall be deemed to be a resident only of the State in which he has a permanent home
available to him; if he has a permanent home available to him in both States, he shall
be deemed to be a resident only of the State with which his personal and economic
relations are closer (centre of vital interests);

(b)

if
the State in which he has his centre of vital interests cannot be determined, or if he
has not a permanent home available to him in either State, he shall be deemed to be a
resident only of the State in which he has an habitual
abode;

(c)

if he
has an habitual abode in both States or in neither of them, he shall be deemed to be a
resident only of the State of which he is a national;

(d)

if he
is a national of both States or of neither of them, the competent authorities of the
Contracting States shall settle the question by mutual
agreement.

3.

Where
by reason of the provisions of paragraph 1 a person other than an individual is a
resident of both Contracting States, then the competent authorities of the Contracting
States shall resolve the question by mutual agreement.

1.

For
the purposes of this Agreement, the term “permanent establishment” means a fixed place
of business through which the business of an enterprise of a contracting State is wholly
or partly carried on in the other Contracting State.

2.

The
term “permanent establishment” includes especially:

(a)

a
place of management;

(b)

a
branch;

(c)

an
office;

(d)

a
factory;

(e)

a
workshop;

(f)

a
warehouse or premises used as sales outlet;

(g)

a
farm or plantation; and

(h)

a
mine, an oil or gas well, a quarry, or any other place of extraction or exploration or
exploitation of natural resources including timber or forest produce, an installation,
structure, drilling rig or working ship used for exploration or exploitation of natural
resources.

3.

The
term “permanent establishment” also encompasses:

(a)

a
building site, a construction, assembly or installation projector supervisory activities
in connection therewith, but only if such site, project or activities last more than 183
days;

(b)

the
furnishing of services, including consultancy services, by an enterprise through
employees or other personnel engaged by the enterprise for such purpose, but only if
activities of that nature continue (for the same or a connected project) within a
Contracting State for a period or periods aggregating more than 183 days within any
12–month period.

4.

Notwithstanding the preceding provisions of this Article, the
term “permanent establishment” shall be deemed not to
include:

(a)

the
use of facilities solely for the purpose of storage or display of goods or merchandise
belonging to the enterprise;

(b)

the
maintenance of a stock of goods or merchandise belonging to the enterprise solely for
the purpose of storage or display;

(c)

the
maintenance of a stock of goods or merchandise belonging to the enterprise solely for
the purpose of processing by another enterprise;

(d)

the
maintenance of a fixed place of business solely for the purpose of purchasing goods or
merchandise or of collecting information, for the
enterprise;

(e)

the
maintenance of a fixed place of business solely for the purpose of advertising, supply
of information, which have a preparatory or auxiliary character, for the
enterprise;

(f)

the
maintenance of a fixed place of business solely for any combination of activities
mentioned in sub-paragraphs (a) to (e),

provided that such activity or, in the case of subparagraph
(f), the overall activity of the fixed place of business, is of a preparatory or
auxiliary character.

5.

Paragraph 4 shall not apply to a fixed place of business that
is used or maintained by an enterprise if the same enterprise or a closely related
enterprise carries on business activities at the same place or at another place in the
same Contracting State and

(a)

that
place or other place constitutes a permanent establishment for the enterprise or the
closely related enterprise under the provisions of this Article,
or

(b)

the
overall activity resulting from the combination of the activities carried on by the two
enterprises at the same place, or by the same enterprise or closely related enterprises
at the two places, is not of a preparatory or auxiliary
character,

provided that the business activities carried on by the two
enterprises at the same place, or by the same enterprise or closely related enterprises
at the two places, constitute complementary functions that are part of a cohesive
business operation.

6.

Notwithstanding the provisions of paragraphs 1 and 2, where a
person-other than an agent of an independent status to whom paragraph 7 applies-is
acting in a Contracting State on behalf of an enterprise of the other Contracting State,
that enterprise shall be deemed to have a permanent establishment in the first-mentioned
Contracting State in respect of any activities which that person undertakes for the
enterprise, if such a person:

(a)

Has
and habitually exercises in that State an authority to conclude contracts in the name of
the enterprise, unless the activities of such person are limited to those mentioned in
paragraph 4 which, if exercised through a fixed place of business, would not make this
fixed place of business a permanent establishment under the provisions of that
paragraph; or

(b)

Has
no such authority, but habitually maintains in the first-mentioned State a stock of
goods or merchandise from which he regularly delivers goods or merchandise on behalf of
the enterprise; or

(c)

Has
no such authority, but habitually secures orders in the first-mentioned State wholly or
almost wholly for the enterprise itself or for the enterprise and other enterprises
which are controlled by it or have a controlling interest in it;
or

(d)

Manufactures or processes goods belonging to the enterprise in
the first-mentioned State.

7.

(a)

An
enterprise of a Contracting State shall not be deemed to have a permanent establishment
in the other Contracting State merely because it carries on business in that other State
through a broker, general commission agent or any other agent of an independent status,
provided that such persons are acting in the ordinary course of their business. Where,
however, a person acts exclusively or almost exclusively on behalf of one or more
enterprises to which it is closely related including commercial and financial relations,
that person shall not be considered to be an independent agent within the meaning of
this paragraph with respect to any such enterprise.

(b)

For
the purpose of this Article, a person is closely related to an enterprise if, based on
all the relevant facts and circumstances, one has control of the other or both are under
the control of the same persons or enterprises. In any case, a person shall be
considered to be closely related to an enterprise if one possesses directly or
indirectly more than 50 per cent of the beneficial interests in the other (or, in the
case of a company, more than 50 per cent of the aggregate vote and value of the
company’s shares or of the beneficial equity interest in the company) or if another
person possesses directly or indirectly more than 50 per cent of the beneficial interest
(or, in the case of a company, more than 50 per cent of the aggregate vote and value of
the company’s shares or of the beneficial equity interest in the company) in the person
and the enterprise.

8.

Notwithstanding the preceding provisions of this Article, an
insurance enterprise of a Contracting State shall, except in regard to re-insurance, be
deemed to have a permanent establishment in the other Contracting State if it collects
premiums in the territory of that other Contracting State or insures risks situated
therein through a person other than an agent of an independent status to whom paragraph
7 applies.

9.

The
fact that a company which is a resident of a Contracting State controls or is controlled
by a company which is a resident of the other Contracting State, or which carries on
business in that other State (whether through a permanent establishment or otherwise),
shall not of itself constitute either company a permanent establishment of the
other.

1.

Income
derived by a resident of a Contracting State from
immovable property (including income from agriculture or forestry) situated in the
other contracting State may be taxed in that other State.

2.

The
term “immovable property” shall have the meaning which ii has under the laws of the
Contracting State in which the property in question is situated. However, for the
purpose of this Agreement, the term shall in any case include property accessory to
immovable property, livestock, and equipment used in agriculture and forestry,
rights to which the provisions of general law respecting landed property apply,
usufruct of immovable property, and rights to variable or fixed payments as
consideration for the working of, or the right to work, mineral deposits, sources,
and other natural resources including timber and other forest produce; ships and
aircraft shall not be regarded as immovable property.

3.

The
provisions of paragraph 1 shall also apply to income derived from the direct use,
letting, or use in any other form of immovable property.

4.

The
provisions of paragraphs 1 and 3 shall also apply to income from immovable property of
an enterprise and to income from immovable property used for the performance of
independent personal services.

1.

The
profits of an enterprise of a Contracting State shall be taxable only in that State
unless the enterprise carries on business in the other Contracting State through a
permanent establishment situated therein. If the enterprise carries on business as
aforesaid, the profits of the enterprise may be taxed in the other State but only so
much of them as is attributable to:

(a)

that
permanent establishment;

(b)

sales
in that other State of goods or merchandise of the same or similar kind as those sold
through that permanent establishment; or

(c)

other
business activities carried on in that other State of the same or similar kind as those
effected through that permanent establishment.

2.

Subject
to the provisions of paragraph 3 of this Article,
where an enterprise of a Contracting State carries on business in the other Contracting
State through a permanent establishment situated therein, there shall in each
Contracting State be attributed to that permanent establishment the profits which it
might be expected to make if it were a distinct and separate enterprise engaged in the
same or similar activities under the same or similar conditions and dealing wholly
independently with the enterprise of which it is a permanent
establishment.

3.

In
the determination of the profits of a permanent establishment, there shall be allowed as
deductions expenses which are incurred for the purpose of the business of the permanent
establishment including executive and general administrative expenses so incurred,
whether in the State in which the permanent establishment is situated or elsewhere.
However, no such deduction shall be allowed in respect of amounts, if any, paid
(otherwise than towards reimbursement of actual expenses) by the permanent establishment
to the head office of the enterprise or any of its other offices, by way of royalties,
fees, or other similar payments in return for the use of patents or other rights, or by
way of commission, for specific services performed or for management, or, except in
the case of a banking enterprise, by way of interest on moneys lent to the permanent
establishment. Likewise, no account shall be taken, in the determination of the profits
of a permanent establishment, for amounts charged (otherwise than towards reimbursement
of actual expenses), by the permanent establishment to the head office of the enterprise
or any of its other offices, by way of royalties, fees or other similar payments in
return for the use of patents or other rights, or by way of commission, for specific
services performed or for management, or, except in the case of a banking enterprise by
way of interest on moneys lent to the head office of the enterprise or any of its other
offices.

4.

Insofar
as it has been customary in a Contracting State to
determine the profits to be attributed to a permanent establishment on the basis of an
apportionment of the total profits of the enterprise to its various parts, nothing in
paragraph 2 shall preclude that Contracting State from determining the profits to be
taxed by such an apportionment as may be customary; the method of apportionment adopted
shall, however, be such that the result shall be in accordance with the principles
contained in this Article.

5.

For
the purposes of the preceding paragraphs, the profits to be attributed to the permanent
establishment shall be determined by the same method year by year unless there is good
and sufficient reason to the contrary.

6.

Where
profits include items of income which are dealt with separately in other Articles of
this Agreement, then the provisions of those Articles shall not be affected by the
provisions of this Article.

1.

Profits
derived by an enterprise of a Contracting State from
the operation of aircraft in international traffic shall be taxable only in that
State.

2.

Profits
from sources within a Contracting State derived by an
enterprise of the other Contracting State from the operation in international traffic of
ships may be taxed in the first mentioned State, but the tax imposed in that State shall
be reduced by an amount equal to 50 per cent thereof.

3.

The
provisions of paragraphs 1 and 2 shall also apply to profits from the participation in a
pool, a joint business, or an international operating
agency.

1.

Where

(a)

an
enterprise of a Contracting State participates directly or indirectly in the management,
control, or capital of an enterprise of the other Contracting State;
or

(b)

the
same persons participate directly or indirectly in the management, control, or capital
of an enterprise of a Contracting State and an enterprise of the other Contracting
State,

and
in either case conditions are made or imposed between the two enterprises in their
commercial or financial relations which differ from those which would be made between
independent enterprises, then any profits which would, but for those conditions have
accrued to one of the enterprises, but by reason of those conditions have not so
accrued, may be included in the profits of that enterprise and taxed
accordingly.

2.

Where
a Contracting State includes in the profits of an enterprise of that State – and taxes
accordingly – profits on which an enterprise of the other Contracting State has been
charged to tax in that other State and the profits so included are profits which would
have accrued to the enterprise of the first-mentioned State if the conditions made
between the two enterprises had been those which would have been made between
independent enterprises, then that other State shall make an appropriate adjustment to
the amount of the tax charged therein on those profits. In determining such adjustment,
due regard shall be had to the other provisions of the Agreement and the competent
authorities of the Contracting States shall, if necessary, consult each
other.

3.

The
provisions of paragraph 2 shall not apply where judicial, administrative or other legal
proceedings have resulted in a final ruling that by actions giving rise to an adjustment
of profits under paragraph 1, one of the enterprises concerned is liable to penalty with
respect to fraud, gross negligence or willful default.

1.

Dividends paid by a company which is a resident of a
Contracting State to a resident of the other Contracting State may be taxed in that
other State.

2.

However, such dividends may also be taxed in the Contracting
State of which the company paying the dividends is a resident and according to the laws
of that State, but if the beneficial owner of the dividends is a resident of the other
Contracting State, the tax so charged shall not exceed 10 per cent of the gross amount
of the dividends. This paragraph shall not affect the taxation of the company in respect
of the profits out of which the dividends are paid.

3.

The
term “dividends” as used in this Article means income from shares or other rights, not
being debt-claims, participating in profits, as well as income from other corporate
rights which is subjected to the same taxation treatment as income from shares by the
laws of the State of which the company making the distribution is a
resident.

4.

The
provisions of paragraphs 1 and 2 shall not apply if the beneficial owner the dividends,
being a resident of a Contracting State, carries on business in the other Contracting
State, of which the company paying the dividends is a resident, through a permanent
establishment situated therein, or performs in that other State independent personal
services from a fixed base situated therein, and the holding in respect of which the
dividends are paid is effectively connected with such permanent establishment or fixed
base. In such case, the provisions of Article 7 or Article 15, as the case may be, shall
apply.

5.

Nothing
in this Agreement shall be construed as preventing a
Contracting State from imposing tax on the disposal of profits of a permanent
establishment out of that Contracting State in accordance with the provisions of its
domestic law. However, the tax so imposed shall not exceed the rate specified in
paragraph 2 of this Article.

6.

Where
a company which is a resident of a Contracting State derives profits or income from the
other Contracting State, that other State may not impose any tax on the dividends
paid by the company, except in so far as such dividends are paid to a resident of that
other State or in so far as the holding in respect of which the dividends are paid is
effectively connected with a permanent establishment or a fixed base situated in that
other State, nor subject the company’s undistributed profits to a tax on the company’s
undistributed profits, even if the dividends paid or the undistributed profit consist
wholly or partly of profits or income arising in such other
State.

1.

Interest arising in a Contracting State and paid to a resident
of the other Contracting State may be taxed in that other
State.

2.

However, such interest may also be taxed in the Contracting
State in which it arises and according to the laws of that State, but if the beneficial
owner of the interest is a resident of the other Contracting State, the tax so charged
shall not exceed 10 per cent of the gross amount of the
interest.

3.

Notwithstanding the provisions of paragraph 2, interest
arising in a Contracting State and paid to the Government, or a local authority, the
Central Bank or any financial institution wholly owned by the Government of the other
Contracting State shall be exempt in the first-mentioned
State:

(a)

in
the case of Indonesia.

(i)

Bank
Indonesia (the Central Bank of Indonesia);

(ii)

Lembaga
Pembiayaan Ekspor Indonesia (the Indonesia
Eximbank);

(iii)

Badan
Penyelenggara Jaminan Sosial Kesehatan (the Indonesia Social Security Agency for
Health);

(iv)

Badan
Penyelenggara Jaminan Sosial Ketenagakerjaan (the Indonesia Social Security Agency for
Manpower); and

(v)

a
statutory body or any institution as may be agreed from time to time between the
competent authorities of the Contracting States;

(b)

in
the case of Cambodia:

(i)

the
Central Bank or any local authority;

(ii)

the
Rural Development Bank;

(iii)

the
National Social Security Fund; and

(iv)

a
statutory body or any institution as may be agreed from time to time between the
competent authorities of the Contracting States.

4.

The
term “interest” as used in this Article means income from debt-claims of every kind,
whether or not secured by mortgage and whether or not carrying a right to
participate in the debtor’s profits, and in particular, income from government
securities and income from bonds or debentures, including premiums and prizes attaching
to such securities, bonds or debentures, as well as any other amounts treated as
income from money lent by the laws, relating to tax, of the Contracting State in
which the income arises. Penalty charges for late payment shall not be regarded as
interest for the purpose of this Article.

5.

The
provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the
interest, being a resident of a Contracting State, carries on business in the other
Contracting State in which the interest arises, through a permanent establishment
situated therein, or perform in that other State independent personal services from a
fixed base situated therein, and the debt-claim in respect of which the interest is paid
is effectively connected with (a) such permanent establishment or fixed base or with (b)
business activities referred to under (c) of paragraph 1 of Article 7. In such cases the
provisions of Article 7 or Article 15, as the case may be, shall
apply.

6.

Interest shall be deemed to arise in a Contracting State when
the payer is a resident of that State. Where, however, the person paying the interest,
whether he is a resident of a Contracting State or not, has in a Contracting State a
permanent establishment or a fixed base in connection with which the indebtedness on
which the interest is paid was incurred, and such interest is borne by such permanent
establishment or fixed base, then such interest shall be deemed to arise in the State
which the permanent establishment or fixed base is situated.

7.

Where,
by reason of a special relationship between the payer
and the beneficial owner or between both of them and some other person, the amount of
the interest, having regard to the debt-claim for which it is paid, exceeds the amount
which would have been agreed upon by the payer and the beneficial owner in the absence
of such relationship, the provisions of this Article shall apply only to the
last-mentioned amount. In such case, the excess part of the payments shall remain
taxable according to the laws of each Contracting State, due regard being had to the
other provisions of this Agreement.

1.

Royalties arising in a Contracting State and paid to a
resident of the other Contracting State may be taxed in that other
State.

2.

However, such royalties may also be taxed in the Contracting
State in which they arise and according to the laws of that State, but if the beneficial
owner of the royalties is a resident of the other Contracting State, the tax so charged
shall not exceed 10 per cent of the gross amount of the
royalties.

3.

The
term “royalties” as used in this Article means payments of any kind received as a
consideration for the use of, or the right to use, any copyright of literary, artistic
or scientific work including cinematograph films, or films or tapes used for radio or
television broadcasting, any patent, trademark, design or model, plan, secret formula or
process, or for the use of, or the right to use, industrial, commercial or scientific
equipment or for information concerning industrial, commercial or scientific
experience.

4.

The
provisions of paragraphs 1 and 2 of this Article shall not apply if the beneficial owner
of the royalties, being a resident of a Contracting State, carries on business in the
other Contracting State in which the royalties arise through a permanent establishment
situated therein, or performs in that other State independent personal services from a
fixed base situated therein, and the right or property in respect of which the royalties
are paid is effectively connected with (a) such permanent establishment or fixed base,
or with (b) business activities referred to in (c) of paragraph 1 of Article 7. In such
case, the provisions of Article 7 or Article 15, as the case may be, shall
apply.

5.

Royalties shall be deemed to arise in Contracting State when
the payer is a resident of that State. Where, however, the person paying the royalties,
whether he is a resident of a Contracting State or not, has in a Contracting State a
permanent establishment or a fixed base in connection with which the liability to pay
the royalties was incurred, and such royalties are borne by such permanent establishment
or fixed base, then such royalties shall be deemed to arise in the State in which
the permanent establishment or fixed base is situated.

6.

Where,
by reason of a special relationship between the payer
and the beneficial owner or between both of them and some other person, the amount of
the royalties, having regard to the use, right, or information for which they are paid,
exceeds the amount which would have been be agreed upon between the payer and beneficial
owner in the absence of such relationship, the provisions of this Article shall apply
only to the last-mentioned amount. In such case, the excess part of the payments shall
remain taxable according to the laws of each Contracting State, due regard being had to
the other provisions of this Agreement.

1.

Fees
for technical services arising in a Contracting State which are derived by a resident of
the other Contracting State may be taxed in that other
State.

2.

However, fees for technical services may also be taxed in the
Contracting State in which they arise, and according to the laws of that State, but if
the recipient is the beneficial owner of the fees for technical services, the tax so
charged shall not exceed 10 per cent of the gross amount of the fees for technical
services.

3.

The
term “fees for technical services” means payment of any kind in consideration for the
rendering of any managerial, technical or consultancy services, including the provision
by the enterprise of the services of technical or other personnel, but does not include
payments for services to which Article 16 of this Agreement
applies.

4.

The
provisions of paragraph 1 of this Article shall not apply if the beneficial owner of the
fees for technical services, being a resident of a Contracting State, carries on
business in the other Contracting State in which the fees for technical services arise
through a permanent establishment situated therein, and the fees for technical services
are effectively connected with (a) such permanent establishment, or with (b) business
activities referred to in (c) of paragraph 1 of Article 7. In such case, the provisions
of Article 7 shall apply.

5.

Fees
for technical services shall be deemed to arise in a Contracting State when the payer is
a resident of that State. Where, however, the person paying the fees for technical
services, whether he is a resident of a Contracting State or not, has in a Contracting
State a permanent establishment or a fixed base in connection with which the obligation
to pay the fees for technical services was incurred, and such fees for technical
services are borne by such permanent establishment or fixed base, then such fees for
technical services shall be deemed to arise in the Contracting State in which the
permanent establishment or fixed base is situated.

6.

Where,
by reason of a special relationship between the prayer
and the beneficial owner or between both of them and some other person, the
amount of the fees for technical services paid exceeds, for whatever reason, the
amount which would have been agreed upon by the payer and the beneficial owner in
the absence of such relationship, the provisions of this Article shall only apply to the
last-mentioned amount In such case, the excess part of the payments shall remain taxable
according to the law of each Contracting State, due regard being had to the other
provisions of this Agreement.

1.

Gains
derived by a resident of a Contracting State from the alienation of immovable property
referred to in Article 6 and situated in the other Contracting State may be taxed in
that other State.

2.

Gains
from the alienation of movable property forming part of the business property of a
permanent establishment which an enterprise of a Contracting State has in the other
Contracting State or of movable property pertaining to a fixed base available to a
resident of a Contracting State in the other Contracting State for the purpose of
performing independent personal services, including such gains from the alienation of
such a permanent establishment (alone or with the whole enterprise) or of such fixed
base, may be taxed in that other State.

3.

Gains
derived by an enterprise of a Contracting State from the alienation of ships or aircraft
operated in international traffic or movable property pertaining to the operation of
such ships or aircraft shall be taxable only in that State.

4.

Gains
derived by a resident of a Contracting State from the alienation of shares deriving more
than 50 per cent of their value directly or indirectly from immovable property situated
in the other Contracting State may be taxed in that other
State.

5.

Gains
from the alienation of any property other than that referred to in the preceding
paragraphs of this Article shall be taxable only in the Contracting State of which the
alienator is a resident.

1.

Subject
to the provisions of Article 13, income derived by an
individual who is a resident of a Contracting State in respect of professional services
or other activities of an independent character shall be taxable only in that State
except in the following circumstances, when such income may also be taxed in the other
Contracting State:

(a)

If he
has a fixed base regularly available to him in the other Contracting State for the
purpose of performing his activities; in that case, only so much of the income as is
attributable to that fixed base may be taxed in that other Contracting State;
or

(b)

If
his stay in the other Contracting State is for a period or periods amounting to or
exceeding in the aggregate 183 days in any 12-month period; in that case, only so much
of tile income as is derived from his activities performed in that other State may be
taxed in that other State.

2.

The
term “professional services” includes especially independent scientific, literary,
artistic, educational or teaching activities, as well as the independent activities of
physicians, lawyers, engineers, architects, dentists, and
accountants.

1.

Subject
to the provisions of Articles 17, 19, and 20,
salaries, wages, and other similar remuneration derived by a resident of a Contracting
State in respect of an employment shall be taxable only in that State unless the
employment is exercised in the other Contracting State. If the employment is so
exercised, such remuneration as is derived therefrom may be taxed in that other
State.

2.

Notwithstanding the provisions of paragraph 1, remuneration
derived by a resident of a Contracting State in respect of an employment exercised in
the other Contracting State shall be taxable only in the first-mentioned State
if:

(a)

the
recipient is present in the other State for a period or periods not exceeding in the
aggregate 183 days in any 12-month; and

(b)

the
remuneration is paid by, or on behalf of, an employer who is not a resident of the other
State, and

(c)

the
remuneration is not borne by a permanent establishment or a fixed base which the
employer has in the other State.

3.

Notwithstanding the preceding provisions of this Article,
remuneration derived in respect of an employment exercised aboard a ship or aircraft
operated in international traffic by an enterprise of a Contracting State may be taxed
in that State.

1.

Directors’ fees and other similar payments derived by a
resident of a Contracting State in his capacity as a member of the Board of Directors or
any other similar organ of a company which is a resident of the other Contracting State
may be taxed in that other State.

2.

Salaries, wages and other similar remuneration derived by a
resident of a Contracting State in his capacity as an official in a top-level managerial
position of a company which is a resident of the other Contracting State may be taxed in
that other State.

1.

Notwithstanding the provisions of Articles 15 and 16, income
derived by a resident of a Contracting State as an entertainer, such as a theatre,
motion picture, radio or television artiste, or a musician, or as a sportsperson, from
his personal activities as such exercised in the other Contracting State, may be taxed
in that other State.

2.

Where
income in respect of personal activities exercised by an entertainer or a sportsperson
in his capacity as such accrues not to the entertainer or sportsperson himself but to
another person, that income may, notwithstanding the provisions of Articles 7, 15, and
16, be taxed in the Contracting State in which the activities of the entertainer or
sportsperson are exercised.

3.

Notwithstanding the provisions of paragraphs 1 and 2 of this
Article, income derived in respect of the activities referred to in paragraph 1 of this
Article within the framework of cultural or sports exchange program agreed upon by both
Contracting States shall be exempt from tax in the Contracting State in which these
activities are exercised.

1.

Subject
to the provisions of paragraph 2 of Article 20,
pensions, annuities, and other similar remuneration paid to a resident of a Contracting
State in consideration of past employment may be taxed in that
State.

2.

However, such pensions, annuities, and other similar
remuneration may also be taxed in the other Contracting State if the payment is made by
a resident of that other State or a permanent establishment situated therein. The term
“annuity” means a stated sum payable periodically at stated times during life of the
annuitant or during a specified or ascertainable period of time under an obligation to
make the payments in return for adequate and full consideration in money or money’s
worth.

3.

Notwithstanding the provisions of paragraphs 1 and 2, pensions
paid and other payments made under a public scheme which is part of the social security
system of a Contracting State or a local authority thereof shall be taxable only in that
State.

1.

(a)

Salaries, wages and other similar remuneration paid by a
Contracting State or a local authority or a statutory body thereof to an individual in
respect of services rendered to that State or authority or statutory body shall be
taxable only in that State.

(b)

However, such salaries, wages and other similar remuneration
shall be taxable only in the other Contracting State if the services are rendered in
that State and the individual is a resident of that State
who:

(i)

is a
national of that State; or

(ii)

did
not become a resident of that State solely for the purpose of rendering the
services.

2.

(a)

Notwithstanding the provisions of paragraph 1, pensions and
other similar remuneration paid by, or out of funds created by, a Contracting State or a
local authority thereof to an individual in respect of services rendered to that State
or authority or statutory body shall be taxable only in that
State.

(b)

However, such pensions and other similar remuneration shall be
taxable only in the other Contracting State if the individual is a resident of, and a
national of, that other State.

3.

The
provisions of Articles 16, 17, 18, and 19 shall apply to salaries, wages, pensions, and
other similar remuneration in respect of services rendered in connection with a business
carried on by a Contracting State or a local authority or a statutory body
thereof.

1.

Payments which a student, business apprentice, or trainee who
is or was immediately before visiting a Contracting State a resident of the other
Contracting State and who is present in the first-mentioned State solely for the purpose
of his education or training receives for the purpose of his maintenance, education, or
training shall not be taxed in that State, provided that such payments arise from
sources outside that State.

2.

In
respect of grants, scholarships, and remuneration from employment not covered by
paragraph 1, a student or business apprentice or trainee described in paragraph 1 shall
in addition be entitled during such education or training to the same exemptions,
reliefs, or reductions in respect of taxes available to residents of the State which he
is visiting.

1.

An
individual who is or was a resident of a Contracting State immediately before making a
visit to the other Contracting State, and who, at the invitation of any university,
college, school or other similar educational institution which is recognised by the
government, museum or other cultural institution in that other State, is present in that
other State for a period not exceeding two consecutive years solely for the purpose of
teaching, giving lectures or carrying out research at such institution shall be exempt
from tax in that other Contracting State on any remuneration for such
activity.

2.

The
provisions of paragraph 1 shall not apply to income from research if such research is
undertaken by the individual primarily for the private benefit of a specific person or
persons.

1.

Items
of income of a resident of a Contracting State, wherever arising, not dealt with in the
foregoing Articles of this Agreement shall be taxable only in that
State.

2.

The
provisions of paragraph 1 shall not apply to income, other than income from immovable
property as defined in paragraph 2 of Article 6, if the recipient of such income, being
a resident of a Contracting State, carries on business in the other Contracting State
through a permanent establishment situated therein, or performs in that other State
independent personal services from a fixed base situated therein and the right or
property in respect of which the income is paid is effectively connected with such
permanent establishment or fixed base. In such case the provisions of Article 7 or
Article 15, as the case may be, shall apply.

3.

Notwithstanding the provisions of paragraphs 1 and 2, items of
income of a resident of a Contracting State not dealt with in the foregoing Articles of
this Agreement and arising in the other Contracting State may also be taxed in that
other State.

1.

Where
a resident of a Contracting State derives income which, in accordance with the
provisions of this Agreement, may be taxed in the other Contracting State, the
first-mentioned Contracting State shall allow as a deduction from the tax on the income
of that resident an amount equal to the tax paid in the other Contracting State. Such
deduction shall not, however, exceed that part of the income tax, as computed before the
deduction is given, which is attributable to the income which may be taxed in that other
State.

2.

For
the purposes of allowance as credit in a Contracting State, the tax paid in the other
Contracting State shall be deemed to include the amount of tax which is otherwise
payable in that other Contracting State but has been exempted or reduced in accordance
with incentive laws and connected regulations designed to promote economic development
in that other State.

3.

For
the purposes of paragraph 1 of this Article, the term “tax paid”, in the case of
Cambodia, does not include Additional Profit Tax on Dividend Distribution payable in
respect of income to which the provisions of paragraph 2 of this Article
applies.

1.

Nationals of a Contracting State shall not be subjected in the
other Contracting State to any taxation or any requirement connected therewith which is
other or more burdensome than the taxation and connected requirements to which nationals
of that other State in the same circumstances, in particular with respect to residence,
are or may be subjected.

2.

The
taxation on a permanent establishment which an enterprise of a Contracting State has in
the other Contracting State shall not be less favourably levied in that other State than
the taxation levied on enterprises of that other State carrying on the same activities.
This provision shall not be construed as obliging a Contracting State to grant to
residents of the other Contracting State any personal allowances, reliefs and reductions
for taxation purposes on account of civil status or family responsibilities which it
grants to its own residents.

3.

Except
where the provisions of paragraph 1 of Article 9,
paragraph 7 of Article 11, or paragraph 6 of Article 12, paragraph 6 of Article 13
apply, interest, royalties, technical fees and other disbursements paid by an enterprise
of a Contracting State to a resident of the other Contracting State shall, for the
purpose of determining the taxable profits of such enterprise, be deductible under the
same conditions as if they had been paid to a resident of the first-mentioned
State.

4.

Enterprises of a Contracting State, the capital of which is
wholly or partly owned, or controlled, directly or indirectly, by one or more residents
of the other Contracting State, shall not be subjected in the first-mentioned State to
any taxation or any requirement connected therewith which is other or more burdensome
than the taxation and connected requirements to which other similar enterprises of the
first-mentioned State are or may be subjected.

5.

Nothing
contained in the preceding paragraphs of this article
shall be construed as affecting any provisions of the laws of the respective Contracting
States regarding any tax concessions granted.

6.

In
this Article, the term “taxation” means taxes which are the subject of this
Agreement.

1.

Where
a resident of a Contracting State considers that the actions of one or both of the
Contracting States result or will result for him in taxation not in accordance with the
provisions of this Agreement, he may, irrespective of the remedies provided by the
domestic laws of those States, present his case to the competent authority of the
Contracting State of which he is a resident or, if his case comes under paragraph 1 of
Article 24, to that of the Contracting State of which he is a national. The case must be
presented within three years from the first notification of the action resulting in
taxation not in accordance with the provisions of this
Agreement.

2.

The
competent authority shall endeavor, if the objection appears to it to be justified and
if it is not itself able to arrive at a satisfactory solution, to resolve the case by
mutual agreement with the competent authority of the other Contracting State, with a
view to the avoidance of taxation which is not in accordance with this
Agreement.

3.

The
competent authorities of the Contracting States shall endeavor to resolve by mutual
agreement any difficulties or doubts arising as to the interpretation or application of
the Agreement. They may also consult together for the elimination of double taxation in
cases not provided for in the Agreement.

4.

The
competent authorities of the Contracting States may communicate with each other
directly for the purpose of reaching an agreement in the sense of the preceding
paragraphs.

1.

The
competent authorities of the Contracting States shall exchange such information as is
foreseeably relevant for carrying out the provisions of this Agreement or to the
administration or enforcement of the domestic laws concerning taxes of every kind and
description imposed on behalf of the Contracting States, or of their local authorities,
insofar as the taxation thereunder is not contrary to the Agreement. The exchange of
information is not restricted by Articles 1 and 2.

2.

Any
information received under paragraph 1 by a Contracting State shall be treated as secret
in the same manner as information obtained under the domestic laws of that State and
shall be disclosed only to persons or authorities (including courts and administrative
bodies) concerned with the assessment or collection of, the enforcement or prosecution
in respect of, the determination of appeals in relation to the taxes referred to in
paragraph 1, or the oversight of the above. Such persons or authorities shall use the
information only for such purposes. They may disclose the information in public court
proceedings or in judicial decisions. Notwithstanding the foregoing, information
received by a Contracting State may be used for other purposes when such information may
be used for such other purposes under the laws of both States and the competent
authority of the supplying State authorises such use.

3.

In no
case shall the provisions of paragraph 1 and 2 be construed so as to impose on a
Contracting State the obligation:

(a)

to
carry out administrative measures at variance with the laws and administrative practice
of that or of the other Contracting State;

(b)

to
supply information which is not obtainable under the laws or in the normal course of the
administration of that or of the other Contracting State;

(c)

to
supply information which would disclose any trade, business, industrial, commercial or
professional secret or trade process, or information, the disclosure of which would be
contrary to public policy (ordre public).

4.

If
information is requested by a Contracting State in accordance with this Article,
the other Contracting State shall use its information gathering measures to obtain
the requested information, even though that other State may not need such information
for its own tax purposes. The obligation contained in the preceding sentence is subject
to the limitations of paragraph 3 but in no case shall such limitations be construed to
permit a Contracting State to decline to supply information solely because it has no
domestic interest in such information.

5.

In no
case shall the provisions of paragraph 3 be construed to permit a Contracting State to
decline to supply information solely because the information is held by a bank, other
financial institution, nominee or person acting in an agency or a fiduciary capacity or
because it relates to ownership interests in a person.

This agreement shall enter into force on the latter of the
dates on which the respective Contracting States notify each other in writing,
through diplomatic channels, the completion of the procedures required by its law
or legislation for bringing into force this Agreement. This agreement shall have
effect:

(a)

in Indonesia:

(i)

in respect of taxes withheld at the source to income derived
on or after 1 January in the year next following the year in which the Agreement enters
into force; and

(ii)

in respect of other taxes on income, for taxable years
beginning on or after 1 January in the year next following the year in which the
Agreement enters into force; and

(b)

In Cambodia:

(i)

in respect of taxes withheld at source, in relation to taxable
amount as derived on or after the first day of January following the calendar year in
which the Agreement enters into force and in subsequent calendar years;
and

(ii)

in respect of other Cambodian taxes, in relation to income
arising on or after the first day of January following the calendar year in which the
Agreement enters into force, and in subsequent calendar
years.

This Agreement shall remain in force until terminated by a
Contracting State. Either Contracting State may terminate the Agreement, through
diplomatic channels, by giving written notice of termination on or before
30^th of June of any calendar year following after the period of five
years from the date the Agreement enters into force. In such case, the Agreement shall
cease to have effect:

(a)

in Indonesia:

(i)

in respect of taxes withheld at the source to income derived
on or after 1 January in the year next following the year in which the notice of
termination is given; and

(ii)

in respect of other taxes on income, for taxable years
beginning on or after 1 January in the year next following the year in which the notice
of termination is given; and

(b)

in Cambodia:

(i)

in respect of taxes withheld at source, in relation to taxable
amount as derived on or after the first day of January following the calendar year in
which the notice of termination is given; and

(ii)

in respect of other Cambodian taxes, in relation to income
arising on or after the first day of January following the calendar year in which the
notice of termination is given.

IN WITNESS WHEREOF the undersigned, duly authorized thereto,
have signed this Protocol.

DONE in duplicate at Jakarta
on 23^rd Oct 2017 and at Phnom Penh
on 13^th Oct 2017 in the Indonesian, Khmer, and English
languages, all texts being equally authentic. In the event of any divergence of
interpretation, the English text shall prevail.

For
the Government of the Republic of Indonesia

For
the Royal Government of Cambodia

Dr.
SRI MULYANI
INDRAWATI

Dr.
AUN PORNMONIROTH

Minister of Finance

Senior Minister

Minister of Economy and
Finance

The Government of the Republic of Indonesia and the Royal
Government of Cambodia have agreed at the signing of the Agreement for the avoidance of
double taxation and the prevention of fiscal evasion with respect to taxes on income
that the following provisions shall form an integral part of the said
Agreement:

1.

For the purpose of Article 5, paragraph 2, subparagraph (h),
it is understood that a Permanent Establishment exists from the date on which the
drilling rig or working ship is present in territory of either Contracting
State.

2.

For the purpose of Article 7, it is understood that nothing in
this Article shall affect the application of any law of a Contracting State relating to
tax imposed on income from insurance, other than re-insurance, of non-resident insurers
with a permanent establishment in that Contracting State.

3.

For the purpose of Article 10, paragraph 5, it is understood
that the tax rate limit shall not affect the provision contained in any production
sharing contracts relating to oil and gas, and contract of works for other mining
sectors, concluded by a Contracting State or its relevant state oil and gas company or
any other entity thereof with a person who is a resident of the other Contracting
State.

IN WITNESS WHEREOF the undersigned, duly authorized thereto,
have signed this Agreement.

DONE in duplicate at Jakarta
on 23^rd Oct 2017 and at Phnom Penh
on 13^th Oct 2017 in the Indonesian, Khmer, and English
languages, all texts being equally authentic. In the event of any divergence of
interpretation, the English text shall prevail.

For
the Government of the Republic of Indonesia

For
the Royal Government of Cambodia

Dr.
SRI MULYANI
INDRAWATI

Dr.
AUN PORNMONIROTH

Minister of Finance

Senior Minister

Minister of Economy and
Finance